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Royal Ahold N.V. and its American subsidiary, U.S. Foodservice, entered into a nonprosecution agreement (available below) with the Department of Justice related to accounting fraud that inflated the company's earnings. The former CEO and CFO of U.S. Foodservice and a number of vendors pleaded guilty in 2005 to fraud charges for inflating vendor allowances that allowed them to meet earnings targets. Royal Ahold achieved the Holy Grail of agreements by not even being charged and, perhaps more importantly, being able to call this a nonprosecution agreement (see earlier post here on the importance of the label for companies). Its obligations require it to continue to cooperate in the Department of Justice's prosecution of individual defendants and do not provide any protection from criminal tax charges, although none appear on the horizon. If Royal Ahold can keep its nose clean and cooperate for the next two years (or until all the government litigation is concluded), then it will have completely put behind it a nasty episode without any criminal charges ever having been filed. A Washington Post story (here) discusses the agreement. (ph)